Social Businesses

I attended a seminar a few weeks ago on the topic of Social Businesses which proved very interesting.  A Social Business is started by a Social Entrepreuneur who sees a social gap in society and seeks to provide for it.  Examples could be the lack of adequate public transport for disabled people or  a lack of health assistance for aboriginal children.  The aim of these businesses is to add to the social environment of society . 

This form of social businesses are already operating successfully in the UK. These businesses have grown from considering many of the negative social impacts of deregulated free markets.  The UK has been especially open to this new and innovative concept. This  probably stems from their long social history of wealthy individuals having philanthropic foundations and the large number of charities they have founded. 

An example of this is that in the UK at present there exists a Charity Bank.  This is a Bank especially dedicated to customers who operate on the basis that they are a charity.  This is where the Bank itself focuses on customers who put their primary importance on the Social Economy and advancing the social benefits of society .  Linked with this is the advancement of ethical consumerism such as providing “Fair Trade” products.  These are products that do not use workers from third world countries who are forced to work in appalling conditions and are badly treated.

The speaker also stated her belief that the huge Credit Crisis can be traced back to massive demutualisation of many banks and companies.  Demutualisation is where institutions  are coverted into companies owned by shareholders.  For instance recently in the UK most building societies and insurance companies have demutualised.  The argument against demutualisation, is that these newly formed companies will then run more for the benefit of the shareholders rather than their customers.

Social businesses on the other hand are owned by the employees or the community as distinct from private shareholders.  They are more collaborative in nature and any profits are reinvested to further it’s good cause.   Needless to say that their Social Goals are central to it’s aims rather than primarily seeking  a healthy monetary bottom line.

Included in this idea of a Social Business is the “Quadruple Bottom Line”  as a more complete measurement of success.   This involves a measurement of benefits in the following  areas:-

1.   Economic   2. Social  3.  Environmental  &  4.  Cultural

The speaker stated that all these factors should be considered to assess the effectiveness of a business and should be the way of the future.  The business world can no longer be motivated by greed alone.  If not the search for monetary profit only , may ultimately lead to the social environmental and cultural decay of our society as a whole.

This concept is still in it’s early stages of development.  Naturally there are many questions and possible holes that still need to be filled,  in it’s operation and survival.  A university course is at present being developed to flesh out this new concept and it’s operation in greater depth called the “Graduate Diploma of Social Impact”.  More information about this can be found at the Centre for Social Business (CSI)  – www.csi.edu.au.  Cheryl Kernot has been one of the main researchers, proponets and developers for this course.  She will also be running a workshop for people who have a viable concept or idea for starting a social business.

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